A reaction against social liberalism in the late twentieth century, often called neoliberalism, led to monetarist economic policies and a reduction in government provision of services. However, this reaction did not result in a return to classical liberalism, as governments continued to provide social services and retained control over economic policy.[13]

Origins

United Kingdom

By the end of the nineteenth century, the principles of industrialisation and laissez-faire capitalism came from conservatives concerned about social balance, although socialism later became a more important force for change and reform. Some Victorian writers—including Charles Dickens, Thomas Carlyle, and Matthew Arnold—became early influential critics of social injustice.[15]

John Stuart Mill contributed enormously to liberal thought by combining elements of classical liberalism with what eventually became known as the new liberalism. The new liberals tried to adapt the old language of liberalism to confront these difficult circumstances, which they believed could only be resolved through a broader and more interventionist conception of the state. An equal right to liberty could not be established merely by ensuring that individuals did not physically interfere with each other, or merely by having laws that were impartially formulated and applied. More positive and proactive measures were required to ensure that every individual would have an equal opportunity of success.[16]

In the late nineteenth century and early twentieth century, a group of British thinkers, known as the New Liberals, made a case against laissez-faire classical liberalism and argued in favor of state intervention in social, economic, and cultural life. The New Liberals, which included intellectuals like T.H. Green, L.T. Hobhouse, and John A. Hobson, saw individual liberty as something achievable only under favorable social and economic circumstances.[6] In their view, the poverty, squalor and ignorance in which many people lived made it impossible for freedom and individuality to flourish. New Liberals believed that these conditions could be ameliorated only through collective action coordinated by a strong, welfare-oriented and interventionist state.[17]

Germany

In late nineteenth century Germany, left-liberals established trade unions in order to help workers improve working and economic conditions. Some liberal economists, such as Lujo Brentano or Gerhart von Schulze-Gävernitz, established the Social Policy Association in 1873 to promote social reform. But their ideas found relatively few supporters among the liberal politicians. The main objectives of the left-liberal parties were free speech, freedom of assembly, free trade, representative government, equal and secret suffrage, and protection of private property, although they were strongly opposed to the welfare state, which they called State Socialism. Later Friedrich Naumann, who maintained close contacts with Brentano and Schulze-Gävernitz, founded the National-Social Association, which attempted to combine bourgeois liberalism with proletarian socialism. The new group advocated, among other things, increased social welfare legislation, the right to strike, and profit-sharing in industry. Although the party was unable to win any seats and soon dissolved, the theories it developed would remain influential in German liberalism.

France

In France, social liberal theory was developed in the Third Republic by solidarist thinkers, including Alfred Fouillée and Émile Durkheim, who were inspired by sociology and influenced radical politicians like Léon Bourgeois. They explained that a greater division of labor caused greater opportunity and individualism, but it also inspired a more complex interdependence. They argued that the individual had a debt to society, promoting progressive taxation to support public works and welfare schemes. However, they wanted the state to coordinate rather than to manage, and they encouraged cooperative insurance schemes among individuals. Their main objective was to remove barriers to social mobility rather than create a welfare state.[21]

Implementation

The welfare state grew gradually and unevenly from the late nineteenth century, but became fully developed following the Second World War, along with the mixed market economy. Also called "embedded liberalism", social liberal policies gained broad support across the political spectrum, because they reduced the disruptive and polarizing tendencies in society, without challenging the capitalist economic system. Business accepted social liberalism in the face of widespread dissatisfaction with the boom and bust cycle of the earlier economic system as it seemed to them to be a lesser evil than more left-wing modes of government. Social liberalism was characterized by cooperation between big business, government and labor unions. Government was able to assume a strong role because its power had been strengthened by the wartime economy. However, the extent to which this occurred varied considerably among Western democracies.[24]

Most of the social democratic parties in Europe (notably including the British Labour Party) have taken on strong influences of social liberal ideology. Despite Britain's two major parties coming from the traditions of socialism and conservatism, most substantive political and economic debates of recent times were between social liberal and classical liberal concepts.[26]

Germany

, a German economist, first proposed the German variant of economic social liberalism. In 1932, speaking at the [27]

Following the Second World War, Rüstow's "neoliberalism", now usually called [27]

Rest of Europe

The post-war governments of other countries in Western Europe also followed social liberal policies. These policies were implemented primarily by Christian Democrats and Social Democrats, as liberal parties in Europe declined in strength from their peak in the nineteenth century.[28]

United States

American political discourse resisted this social turn in European liberalism. While the economic policies of the New Deal appeared Keynesian, there was no revision of liberal theory in favor of greater state initiative. Even though America lacked an effective socialist movement, New Deal policies often appeared radical and were attacked by the right. The separate development of modern liberalism in the United States is often attributed to American exceptionalism, which kept mainstream American ideology within a narrow range.[29]

Revival

John Rawls' principal work A Theory of Justice (1971) can be considered a flagship exposition of social liberal thinking, advocating the combination of individual freedom and a fairer distribution of resources. According to Rawls, every individual should be allowed to choose and pursue his or her own conception of what is desirable in life, while a socially just distribution of goods must be maintained. Rawls argued that differences in material wealth are tolerable if general economic growth and wealth also benefit the poorest.[30]A Theory of Justice countered utilitarian thinking in the tradition of Jeremy Bentham, instead following the Kantian concept of a social contract, picturing society as a mutual agreement between rational citizens, producing rights and duties as well as establishing and defining roles and tasks of the state. Rawls put the "equal liberty principle" in the first place, providing every person with equal access to the same set of fundamental(political) liberties; followed by the "fair equality of opportunity" and "difference principle" allowing social and economic inequalities under the precondition that privileged positions are accessible to everyone, that everyone has equal opportunities, and that even the least advantaged members of society benefit from this framework. This was later restated in the equation of Justice as Fairness. Rawls proposed these principles not just to adherents of liberalism, but as a basis for all democratic politics, regardless of ideology. The work advanced social liberal ideas immensely within 1970s' political and philosophic academia.[31] Rawls may therefore be seen as a "patron saint" of social liberalism.[26]

Following economic problems in the 1970s, social liberal thought underwent some transformation. Keynesian economic management was seen as interfering with the free market, while increased welfare spending that had been funded by higher taxes prompted fears of lower investment, lower consumer spending, and the creation of a "dependency culture." Trade unions often caused high wages and industrial disruption, while full employment was regarded as unsustainable. Writers such as Milton Friedman and Samuel Brittan, who were influenced by Friedrich Hayek, advocated a reversal of social liberalism. Their policies, which are often called neoliberalism, had a significant influence on Western politics, most notably on the governments of UK Prime Minister Margaret Thatcher and US President Ronald Reagan, who pursued policies of deregulation of the economy and reduction in spending on social services.[13]

Part of the reason for the collapse of the social liberal coalition was a challenge in the 1970s from financial interests that could operate independently of national governments. Another cause was the decline of organized labor which had formed part of the coalition but was also a support for left-wing ideologies challenging the liberal consensus. Related to this was the decline of working class consciousness and the growth of the middle class. The push by the United States, which had been least accepting of social liberalism, for trade liberalization further eroded support.[32]

Giving an exhaustive list of social liberal parties worldwide is difficult, largely because political organisations are not always ideologically pure. Party ideologies often change over time. However, the following parties and organisations are usually accepted by peers[nb 1] or scholars as following social liberalism as a core ideology.

^ abDimitri Almeida (2012). The Impact of European Integration on Political Parties: Beyond the Permissive Consensus. Routledge. p. 107.

^Sejfija, Ismet (2013), "Analysis of Interviews with Representatives of Political Parties in Bosnia-Herzegovina" (PDF), Dealing with the Past in the Western Balkans. Initiatives for Peacebuilding and Transitional Justice in Bosnia- Herzegovina, Serbia and Croatia (Berghahn Foundation): 92

^Movement genesis: social movement theory and the 1980s West German peace movement by Steve Breyman As quoted in the text: "The Liberal Democrats (Liberale Demokraten or LD) split from the FDP to create their own social-left liberal alternative."

^Globalization, democratization and development: European and Japanese views of change in South East Europe edited by Vojmir Franičević and Hiroshi Kimura. As quoted in the text: "Towards the end of the 1990s the social-liberal Minshuto (Democratic Party of Japan, DPJ) consolidated and replaced Shinshinto as a rival of LDP."

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